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Australia's AEMO unveils power investment needs to 2040

According to the Draft 2020 Integrated System Plan (ISP) released by the Australian Energy Market Operator (AEMO), more than 30 GW of large-scale renewable power capacity is required to replace coal-fired power generation by 2040, when 63% of the country's coal-fired capacity will have retired. The rooftop solar capacity is expected to double or even triple by 2040, accounting for up to 22% of the power mix. To back up renewables, up to 21 GW of new dispatchable resources are needed, such as utility-scale pumped hydro or battery storage, demand response (demand-side participation), and distributed batteries participating as virtual power plants.

Australia will also need to invest in its power grid to balance resources across states and unlock the proposed Renewable Energy Zones (REZ). The AEMO identifies several priority projects, including a new 330 kV transmission line from Robertstown in South Australia to Wagga Wagga in New South Wales (NSW) (EnergyConnect), a new interconnection from Western Victoria to southern NSW and the Snowy 2.0 hydropower project, and a new interconnection from Tumut to Bannaby to reinforce the southern NSW grid (HumeLink). In addition, the existing interconnection from NSW to Queensland and Victoria will have to be upgraded, and planning and approvals work should start for a new power transmission link from Tasmania to Victoria (Marinus Link).

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